Today, most families consume some food produced in other countries as well as food grown inside their own national borders. Foods produced outside the country may, in many cases, be higher quality, more nutritious food. Unfortunately, the prices of these foods--especially grains and other basic foodstuffs considered "commodities"--are subject to the ups and downs of the international market. As prices continue to rise, guidelines must be established to reduce the volatility of international prices and allow families access to healthy, inexpensive food.
Recently, the G-20 has taken up the issue. Its November 2011 Declaration and Action Plan on Food Price Volatility recognizes the problem and proposes measures to respond to it. The essence of the plan is that agricultural production must be increased in order to promote food security and facilitate sustainable economic growth. In addition, a stable, predictable, open, and transparent trade system that is free of distortions is needed to permit greater investment in agriculture, which would reduce prices as the supply of food increases. The G-20 calls for improved agricultural production and productivity and more information about the agricultural products market for greater transparency. It aims to reinforce coordination on international policies, improve the functioning of the commodities market, and reduce the effects of price volatility on the most vulnerable.
However, these measures alone do not solve the problem. Other variables that have a direct influence on international trade in food must also be considered, such as: climate change which is causing flooding and droughts that prevent the production of basic foods; population growth and the corresponding demand for more food; the effect of biodiesel production on food prices; and the fact that people's eating habits are changing. Added to these factors are international price speculation and the difference in prices between the places fit for producing food and places where food must be purchased. Repercussions of varying kinds occur in different countries throughout the world, but those who suffer most are the poorest people in countries that must import food. In those places, the absence of adequate transportation infrastructure further increases the price that the final consumer must pay.
Other factors influencing the price of food are the taxes applied directly to food sales and taxes...